How to Roll Over a 401(k) to a New Employer's Plan (and Whether You Should)

Moving an old 401(k) into your new employer's plan takes two phone calls and a form. The harder part is deciding whether the new plan is the right home for the money, or whether an IRA would serve you better.

If you only read this far

Your new plan doesn't have to accept rollovers. Ask before you request anything from the old plan.
Ask for a direct rollover, with the payment made out to the new plan and not to you. No tax is withheld and no 60-day clock starts.
A 401(k) keeps things an IRA can't offer: the rule of 55, plan loans, federal creditor protection, and a possible delay on required withdrawals while you're still working there.
An IRA gives you far more investment choice and full control over withdrawals.
You don't have to pick one. Many plans allow partial rollovers.

Should you do it at all?

Start here, because the paperwork is easy once you've decided. We cover all four choices for an old 401(k) in what to do with an old 401(k). This page is about the choice between the new plan and an IRA.

	Roll into the new employer's 401(k)	Roll into an IRA
Fees	Set by the plan. Large plans can be very cheap. Small plans can be costly.	Set by what you buy. Index funds at a low-cost custodian cost very little. Advisory accounts and specialty products cost more.
Investment choice	The plan's menu of funds	Nearly anything the custodian offers
Rule of 55	Can apply if you leave this employer in or after the year you turn 55	Doesn't apply to IRAs
Loans	Allowed if the plan offers them	Not allowed
Required minimum distributions while still working	You can wait until the year you retire, if the plan allows it and you don't own more than 5% of the company	Start at your RMD age whether you're working or not
Creditor protection	Federal ERISA protection from most creditors	Strong in federal bankruptcy; outside bankruptcy it depends on your state
Access to the money	Limited by plan rules while you're employed	Any time, with tax and a possible 10% penalty before 59½

Fees

Neither side wins this by default. Get the new plan's annual fee disclosure (it's sometimes called a 404(a)(5) notice) and look at two numbers: the expense ratio of the funds you'd use, and any administrative fee charged to your account. Then compare with what the same kind of fund costs in an IRA.

If the plan's index funds cost about what an IRA's would, fees are a tie and the other rows in the table should decide it. If the plan's cheapest option runs 0.90% a year, that's a real cost on a large balance.

Investment choice

A plan menu is short on purpose, and a few low-cost index funds are enough for a lot of people. If you want individual bonds, CDs, or alternative assets such as physical metals in a self-directed IRA, only an IRA gets you there.

The rule of 55

If you leave an employer in or after the calendar year you turn 55, withdrawals from that employer's plan skip the 10% early withdrawal tax. Income tax still applies. IRAs don't get this exception.

Here's why it matters for a rollover. If you're 52 and think you might stop working at 56, money sitting in your new employer's plan when you leave could be reachable without the penalty. The tax code writes the exception for distributions from the plan of the employer you left. It doesn't sort the dollars by where they first came from. We haven't found an IRS page that speaks to rolled-in money by name, so confirm with the plan and a tax professional how it treats that money and what withdrawal options it gives former employees. The same dollars in an IRA would be locked behind age 59½. Our rule of 55 guide goes through the fine print.

Loans

You can't borrow from an IRA. If the new plan offers loans, rolled-in money may count toward the balance you can borrow against. Ask, because plans differ.

If you still owe on a loan from the old plan, deal with that first. When you leave a job with a loan outstanding, the plan can reduce your balance by the unpaid amount. That's called a loan offset, and it's treated as a distribution. You can avoid the tax by putting the same amount of your own money into an IRA or the new plan. When the offset happened because you left the job and the loan was in good standing, you have until your tax return due date, including extensions, for that year to do it.

Required minimum distributions if you work past 73

IRAs require withdrawals once you reach your RMD age (73 as of 2026), employed or not. A 401(k) can be different. If you're still working for the employer that sponsors the plan, you don't own more than 5% of the business, and the plan allows it, you can put off RMDs from that plan until the year you retire.

That exception covers only the current employer's plan. An old 401(k) left behind, or an IRA, still has RMDs. So if you expect to work into your mid-70s, rolling old money into the current plan can delay withdrawals on it. See RMD age by birth year for your own start date.

Creditor protection

Most employer 401(k) plans are covered by ERISA, which keeps plan money away from most creditors, in or out of bankruptcy. IRAs are well protected in federal bankruptcy, but protection from an ordinary lawsuit depends on your state. We go into this in rollover IRA vs. traditional IRA.

Questions to ask the new plan

Call the number in your enrollment packet, or ask HR who runs the plan. Then ask:

Does the plan accept rollovers from a former employer's 401(k)? From an IRA?
Can I roll money in now, or do I have to wait until I'm eligible to participate?
Do you accept Roth 401(k) money? After-tax money?
What form do you need, and do you need a letter or statement from the old plan?
How exactly should the check be made payable, and where does it go? Is there a wire option?
How will the money be invested when it arrives? Does it follow my current elections or go to a default fund?
Is rolled-in money kept in a separate rollover account, and can I withdraw it while I'm still employed?
If I leave after 55, what withdrawal options do former employees have? Partial withdrawals, or lump sum only?
Where is the fee disclosure, and what are the expense ratios on the funds I'd use?

Questions to ask the old plan

What's my vested balance, and how much of it is pre-tax, Roth, and after-tax?
Do you need a signature guarantee, a notarized signature, or my spouse's consent?
Will you send the money electronically or by check? If by check, is it mailed to me or to the new plan?
Do I have an outstanding loan, and what happens to it?
Do I hold company stock in the plan? (If so, read about net unrealized appreciation in our old 401(k) guide before moving anything.)
Can I roll over part and leave part?

How to do the rollover, step by step

Enroll in the new plan. You need an account there before it can receive money.
Get the new plan's rollover-in form and payee wording. The check is usually payable to the new plan's trustee "FBO" (for the benefit of) you, with your name and plan or account number on it.
Request a direct rollover from the old plan. Give them the payee wording and mailing or wire details exactly as the new plan gave them to you.
Forward the check if it comes to you. Some plans mail the check to your home. If it's payable to the new plan, it's still a direct rollover. Send it on with the rollover-in form. Don't sign the back, and don't deposit it in your own bank account.
Confirm it arrived and is invested. Log in a week or two later. Check the amount and make sure it isn't sitting in a default fund you didn't choose.
Keep the paperwork from both plans.

Roth and after-tax money

A Roth 401(k) balance can move to the new plan's Roth account, if the new plan has one and takes Roth rollovers. Ask for a direct rollover. It's the method that carries the whole Roth balance over, and your earlier Roth start date comes with it.

After-tax (non-Roth) contributions are a special case. A new plan can accept them only by direct rollover, and only if it accounts for them separately. Ask whether it does. A Roth IRA is the other place that slice can go. Ask the old plan for the dollar breakdown before you decide.

How it shows up at tax time

The old plan sends you Form 1099-R early the next year. For a direct rollover it shows the amount moved in Box 1, zero in Box 2a for a pre-tax rollover, and code G in Box 7 (Box 7a on the 2026 form). You report the Box 1 amount on the pensions and annuities line of Form 1040 (line 5a), enter zero as the taxable amount (line 5b), and mark it as a rollover.

You won't get a Form 5498 for a 401(k)-to-401(k) move. That form is only for IRAs. Our guide to Form 1099-R and Form 5498 shows where everything goes.

Our view

If the new plan is cheap and you're within ten years or so of retirement, moving the old 401(k) into it is a good, quiet choice. It can keep the rule of 55 in play, once the plan confirms how it treats rolled-in money, and you have one fewer account to lose track of.

If the new plan is expensive, has a thin menu, or limits former employees to a single lump-sum withdrawal, an IRA is the better home. And if you're torn, split it.

Common questions

Does my new employer have to accept my old 401(k)?

No. The IRS says a retirement plan isn't required to accept rollover contributions. Ask the new plan administrator what they take and when.

Is a 401(k)-to-401(k) rollover taxable?

Not when pre-tax money moves by direct rollover to the new plan's pre-tax account, or Roth money to its Roth account. You'll still get a Form 1099-R and report the move on your return, with zero taxable.

Is there a deadline to roll an old 401(k) into a new plan?

For a direct rollover, no. You can do it years after leaving, as long as both plans allow it. The 60-day deadline applies only when a distribution is paid to you.

Can I roll an IRA into my new 401(k)?

If the plan accepts it. Only pre-tax IRA money can go into an employer plan, and Roth IRAs can't be rolled into a 401(k) at all.

Does the one-rollover-per-year rule apply?

No. That limit covers indirect rollovers between IRAs. Plan-to-plan and plan-to-IRA rollovers aren't counted.

We base our guides on primary sources such as the IRS, the Department of Labor, and federal regulators. Read our editorial policy. Spot an error? Tell us.